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tv   Mad Money  CNBC  April 30, 2015 6:00pm-7:01pm EDT

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underlying business is lng. i think we'll see good growth in the space. a nice run to the upside and i think it continues to move higher, fcx. don't go anywhere. 5:00. meantime, don't go anywhere. "mad money" with jim cramer starts right now. my mission is simple -- to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere. i promise to help you find it. "mad money" starts now. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i'm just trying to save you money. my job isn't just to entertain but to teach you. call me at 1-800-743-cnbc. or tweet me nicely please, @jimcramer. all right. we can talk about the feds role in this quick sand we're swimming in.
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we can draw connections to the dollar and bonds and soft macro data. whatever you want to explain today's decline. dow sinking 195 points, s&p down 1.01%. nasdaq plunging 1.64. i know i have heard all those consents bandied as the scourge of stock owners who got laid to waste today, pulverized. but i think this market is all about eve. yeah. the original eve. who was tricked by the serpent into eating the forbidden apple from the trees. and the whole investor class has been paying the price. the serpent in this case is that apple quarter. the one that seems so tempting to eager investors that they couldn't resist buying the stock ahead of, during and right after earnings. reaching to the skies for it. even as i begged you not to.
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now the investor gods are making every stock pay and the pain won't end. >> the house of pain. >> until these feckless apple traders given up the ghost. >> sell sell sell. >> and then the stock bottoms. hey, look i was going to go with the isaac newton thing. what goes up must come down. but this sell-off i don't know. seems like it's more biblical than newtonian. because in science only the apple takes the fall. here everything that went up seems to be going down. so why don't we offer some perspective, explain why this apple is so important to the entire market which does feel on very shaky ground. if you own stocks, you own them because you want them to report numbers. both top line revenues and bottom line profits that are better than expected. the analyst numbers. you want the sales to be global and promising. the earnings to be thick with expanding gross margins.
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then you want analysts to guide the estimates higher because in biblical terms that's the holy grail of higher stock prices. you want stocks to really get rockin'? throw in a big juicy dividend boost and an awesome buy back expansion. so what happened with apple? it did all of those things and yet since the quarter the stock has now plummeted almost ten points in a straight line. now, let's make this apple story even more juicy. let's say that it sells at dramatic discount to the average piece of fruit out there as represent by the s&p 500 garden. the negative action here stands the whole rationale for buying stocks on its head. if you get everything you wanted and more, like new products that aren't even counted in the revision estimates new relationships like the one with ibm, that can bring out earnings later in the cycle and $200 billion in return capital, that's billion with a "b" and
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apple can't go higher. then what does that say about every other stock out there? you should have faith in nothing. nonstocks would benefit from the better dollar and nonstocks that go up when interest rates rise and nonstocks that win when rates plummet. have faith in nothing. and that's what you saw today. ever since we swallowed the apple the whole race of stocks does seem cursed doesn't it? too simplistic, not for this fundamentalist, a market that doesn't seem to care about the fundamentals of the most important company out there in the world. well, that's just inherently treacherous. let's throw in some technicals. we know that players can be serpents too and we have a cobra striking at everyone who thought apple stock could hold at what turned out to be levels where the fangs levelled. spreading the poison to those who thought it was safe out there ten points ago. now, i'm not overlooking the
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power of actual raw facts like the strong jobless claims we got this morning but i would point out these days all data is subject to immense interpretation. right now again i believe somewhat because of the mack daddy apple that interpretation is being skewed to the negative. after all, didn't the fed reiterate it could raise rates when it wants to? not that that plan hasn't always been in the cards. maybe this week's jobless claims numbers dispositive, so fewviewed through the prism of the fed that's bad. we have weakness in the dollar because europe is getting stronger. any region that's stronger than the u.s. is going to draw capital and that's happening. you get the sea change i keep harping on. the one that i told makes me uncertain and feel queasy and sick in this market. kind of like if you were thinking domestic because you believe the dollar is going higher and hurting our earnings then think again. i see things out there i don't like.
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i see stock that are reporting tremendous energies like apple. hey how about a stock like amerisource, it rallied more than 8 bucks on good news. at least in the morning. then it gave up the ghost, closing unless than two bucks. see stocks like cardinal health another member of the domestic prized cohort a pretty good number and get mowed down like a british soldier on the first day of the battle. retailers were trying to hold on to meager gains but oil going higher is bad, because the consumer won't spend more without that spare change from gasoline. meanwhile, harmon and infotainment company, makes the innards of your car sound like carnegie hall reported an ever so slight miss. while the companies on the show
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later on to talk about the business, people would rather shoot first and sell down ten bucks and listen to the ceo later. heaven help a company that actually disappoints. celgene has some drugs out there that i thought would help the earnings. but they didn't. the negative pin action, it mows down all of -- sell sell sell. ♪ and yelp a company that clearly belongs under someone else's roof. maybe google. perhaps yahoo!. tries to go it alone and sounds confident on the conference call that was met with universal one star ratings. or even a half star. never see that at a restaurant. that's right yelp can't take out ads. and while they're the online yellow page the ads are overpriced and the listings are being given away for free, hence the 23% decline today. oh, believe me people will be calling yelp a trend right?
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when they parse the hideous guidance of internet darling linked in. >> the house of pain. >> don't buy. don't buy. >> they put in a report that sent the stock down more than 20% in the after hours trading. it took me breath away, if not my voice. maybe expedia can mitigate the damage, but i don't think so. but even steady eddie colgate could couldn't deliver. the strong dollar played havoc again. if you believe the green back has peaked we have to deal with previous consequence of the rise. now, what redeems this paradise lost market? what can make it all work out? okay, i'll give you a couple of positive scenarios and everyone is way too negative. if oil stops going up every day as it has been and instead takes a breather or goes down, we stop distaping the consumer driven stocks in companies that use a
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lot of oil. two, forget seller fatigue where people say enough already, things aren't that bad, that could happen. three, if we find new leadership like in the banks, even in the phone calls like skyworks, which reported a rip snorting bullish number this evening. take overor two that would help. maybe a little upside surprise in a biotech. but let's cut to the biblical chase. we need an apple to rise up from the ground a tall order, because this one's falling from the tree and been eaton. oddly enough though, i think that could be a likely scenario. i actually think you should buy some apple tomorrow if you don't have any. i said it would go down for three days after it reported. i told you not to buy before the report, i said wait three days after and then it would try to find some footing. let's take a look see if that doesn't happen tomorrow. i know that we're not supposed to get any rest until day seven, but the investor buy will give you a rest bite. if apple bottoms other stocks will fall into line.
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the nasty sell serpent will get smoeted and then all can be kind of at least okay in the garden of eden once again. anne marie in new york. anne marie? >> caller: jim, thanks for tank my call. >> my pleasure. >> caller: i'm interested in seger fair for the dividend, however, i need your health because the growth rate -- or do i have to wait for a pull back to buy? >> you know what, interest rates seem to be going higher with i could drive that stock down. i have no problem with buying some cedar fair right here, right now. how about adele in florida. >> caller: hi, jim. thanks for taking my call. and a big booyah to you. >> booyah back at you. >> caller: from sunny florida. i have been a long time follower of your show and thank you so much for bringing a wealth of information our way. i have friends who tape your show every night.
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>> well, thank you. remember it's a show about education. i was on twitter today and people were pretty much saying i should retire and go. work for the eagles. okay. >> caller: take more vacations and relax. i need to ask you a question. i have been a long time investor in baidu. for the past five years, i would like to have your input of the stock. we find there's an awful lot -- not today after earnings but generally a lot of volatility trading this stock. we think it's a good company but you're the pro. >> i'm concerned. adele, i'm concerned. this chinese market is overheated. i know baidu has fallen $50 from the top. i think you should take some of that off the table, adele. i don't want you to get hurt. why don't we go to robin in oregon. robin? >> caller: jim, robin in portland, oregon. >> i love portland, what's up? >> caller: jim, i'm glad you're back with your bells, whistles
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and they serve as my daily dose of giggles. i'm calling about cognex and they have applications in a limited number of high speed manufacturing processes across numerous industries and it has a pretty impressive client including apple and sony. >> right. >> caller: since i bought a bunch nearly two years they've doubled in value. >> it's fabulous. >> caller: i don't want to pull out my original investment dollars. i want more shares because i think this company and technology are winners. >> well, look, i think they are. but the report is may 5th. i don't know how long this selling squall will last, but they're taking down some good stocks. let's wait until after we the quarter. all right, apple is the key to this market right now. keep your eye on it. if it bottoms then maybe we can
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bottom and all will be fine once again in the garden of eden. on "mad money" tonight, it's behind the walls, on wheels in the air, eaton just reported. i'm looking to see if it has more power. if you're thinking of buying one of the beaten down stocks you want to hear what i have to say first. believe me. plus, the disrupter changing the way you think about booking travel. my series defining the future continues with the ceo of hotel tonight. you've got to see this. stick with cramer! >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter. have a question? tweet cramer, #madtweets. send jim an e-mail to or give us a call at 1-800-743-cnbc. miss something? head to
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for the last few days i have been telling you about the sea change in the market where a weakening dollar among other
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things is bolstering the stocks of u.s. companies that do a lot of business overseas. which brings me to eaton. a classic industrial with huge industrial exposure that manufactures electrical control products, hydraulics, truck transmissions and aerospace systems. i have liked them for ages. i own it in my charitable trust and last night they reported a good quarter. off the 98 cent basis, some people thought it came in late, but the company is facing some serious strong dollar head winds but thank you managed to off set it with cost controls and improving margins. witness the 140 basis point increase. and plus eaton is paying you a bountiful dividend 3.2%. let's look with sandy cutler the chairman and ceo of eaton and a straight shooter who consistently comes on the show to talk about the result, good
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or bad. welcome back to "mad money." >> good evening, jim, good to be back tonight. >> thank you, sandy. two big segments electrical products and electrical systems and as much as. they both had fabulous margins. we have heard a lot of companies didn't have a good march. what is your company doing different than the other guys? >> well you know i think as many companies and we too experienced a pretty slow january and february particularly here in the u.s. and we were really pleased to see it recover in the third quarter. excuse me n the third month of the quarter. we have been completing the integration of cooper and we're really delighted with the front end synergies, a positive response from our customers and i think that was evidenced as we saw march come together, up some 12% in bookings in the month of march over last year in the electrical businesses. >> sandy, a lot of industrial companies after they reported took down numbers pretty big. you were i thought somewhat bold. you really pretty much left the numbers intact. is that because you saw good momentum in april or because the dollar may have peaked?
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>> well our view is that the only substantial change we saw was really in the fx which is more negative this year but pretty minor adjustment as you mentioned, down to where consensus was. we remained confident that our combination of new product introductions the $150 million of additional synergies we're getting from the cooper acquisition this year, plus $35 million of benefits and restructure we did in the industrial segment last year and then just a darn good cost control that our team has exercised around the world are going to allow us to continue to drive record results this year. >> i talked to you enough about innovation. i thought when i looked at your analyst day the most impressive thing you're doing brought in a deep presence of lighting which turns out uses an awful lot of energy. can you talk about some of the products you have introduced in the last two years that are making a difference to your bottom line? >> yeah. one of the real benefits of the cooper acquisition is we're now in the lighting business and as you know that's a very big user
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of energy and commercial -- in commercial buildings and many other types of installations. i think one of the biggest technology innovations i have seen since the plc replaced relay panels some 40 years ago in the industry. we have introduced that across the spectrum. we are quite pleased with a new introduction even in the last quarter. something we call the night falcon which brings l.e.d. lighting to outside architectural lighting which is the providence of metal lighting. another example we think that this whole industry is going to convert to l.e.d. it's over 50% of the sales in lighting are now l.e.d. some categories as high as 70. we have raised our investment after we bought cooper in this area. i think it's another reflection we're creating above average market growth through really unusual energy saving opportunities for our customers. >> you were very bullish in both aerospace and trucking. feeling good about those because of long term secular trends?
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>> yeah, aerospace is i think we have seen the growth in commercial transports continues to be strong from the big majors. we are seeing year over year increases in line rates so very strong driver there. we're pleased that the tenor of the after market is stronger and then as you mentioned in the north american vehicle marks be they like light vehicle or heavy duty conditions are good. we think on the nafta heavy duty truck side we'll' 330,000 units which is a high since many many years ago. pretty good conditions in the u.s. same picture outside of the u.s. things are slower there so that trend hasn't changed much. >> you are seeing not big infrastructure projects but non-residential and residential being good. again, i think that you must have a good book of business because i'm not getting a similar read on strength. is it you have certain products that are selling right now into
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the residential and non-residential that nobody else? >> yeah, i think resi is choppy. but lower oil prices are good for residential. gives people more money for mortgage payments or considering starting a new house. whether it be the lighting products as i mentioned l.e.d. also goes into residential. whether it be really some of our leading technology toward combining short circuit and art fall protection for homes we have leading products there. on the non-resi side the institutional side the waste water treatment side, all fairly active. what we haven't seen are the very big industrial projects. that's where the softer side of non-res has been here in the u.s. >> finally auto. you seem bullish in your outlook for auto too. >> yeah, i think particularly here in the u.s. where, you know back in the 2008 2009 dark days many people wondered whether we'd ever see this market get back up to 16 million units.
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we have our head over 17 million. we're quite bullish again about some of the technologies we have introduced here that continue to help with fuel economy as well as emissions. those are two of the real key drivers in the marketplace. so pretty healthy market conditions here. china has been pretty healthy on the vehicle side. the light vehicle side, car side as well. the disappointing area in the vehicle markets is south america where clearly the economies are in much more trouble than people had anticipated just four or five years ago. >> only down 1% day, i want to thank you sandy cutler for coming on. chairman and ceo of eaton. thank you so much, sir. >> thanks, jim. okay, look, you know, everyone wants to just sell all stocks. does that really make any sense? let's just stay calm, ride through this. "mad money" is back in a little bit. coming up -- hotel heaven? move over expedia, priceline. there's no easier way to travel in a moment than with hotel tonight. find out what this disrupter is
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doing to turn the hospitality business upside down when our week long series "defining the future" continues.
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is it time to buy the oils? i kept hearing that all over again. i mean, i have to give you severe judgment here. the answer -- no. why?
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because it's too late. there was a time to buy the oils. and that time is now passed. got a lot of chatter today about snapping up the oil stocks because we have the report from exxon mobil, the big daddy of the group. it wasn't that weak. in fact the 2% production was superlative. i thought they couldn't deliver and meanwhile conoco also reported, and it wasn't that bad. and the traders say the worst is over. i agree. but to equate some sort of supposed bottom in the oils with exxon is to miss what's happening in this group for months now. all these bottom callers are late to the party. they're forgetting we already got a real bottom that was forged in both bravery and common sense. oil the commodity is now poised at nearly $60 after plunging to
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as low as $43 when rich kinder came on this show in early february and said that the price had gotten too low and crude belonged at a higher level. kinder does nothing idly. a couple of weeks before that interview he shelled out $3 billion to buy the high land partners pipe line from howard hamm the ceo of continental resources. for those who don't remember, hamm came on the show, stood right here last october when oil was trading at twice that $43 price and called a bottom. a bottom that didn't stand. hamm's company had also put the money where its mouth is too. taking off the hedges against oil plummeting at those exact same high prices which of course turned out to be way too early. plus, the poor guy had to shell out a billion bucks as part of a divorce settlement. hamm may have needed that $3 billion more than most. either that or he was the ultimate buy high, sell low player.
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the opposite of what rich kinder did. now that's a bottom. in that brilliant acquisition, kinder got the most important asset in the bakken shale, namely a pipe line that can take crude from continental, hess and send it to the gulf of mexico to be refined. bakken oil is extremely flammable. kind of like lighter fluid. so it's not ideal for trains that could be exposed to derailment and tanker explosions. perfect for pipe and the only good pipe now is the one that rich kinder in retrospect stole from hamm. in hindsight, we can look back and see a bottom right then and there. pretty much all the charts of the oil stock show it. in february and march not long after kinder bought the pipe line a number of distressed companies raised the numbers and they turned out to be remarkable buys. i'm talking about the
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4.5 million shares that one of my favorites kor ree sows is now at 55. 6 million shares sold at 108, 35 million shares the desperate whiting sold at 30. now 37. and that's what a bottom looks like. not this current action where many of the oil stocks have shot up to where they were when crude was 90 bucks. that's right, 30 bucks higher than where it is right now. in bad times exxon doesn't do that badly and in good times it does fine. but it's not a tell of anything. the real bell rang three months ago when the smartest man in the oil patch rich kinder laid down $3 billion to buy the most prime asset available at a moment when crude was in free-fall. that was the most exquisite of timing. everyone else, well, let's just say there's strictly johnny come lately. let's take some calls. let's go to ryan in california. ryan?
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>> caller: fly eagles fly, jimmy. >> well, we'll see tonight. we'll see tonight. what's going on? >> caller: absolutely. hey, you know, i spread my bets a little bit across midstream integrated and the oil services firms but i'm looking to make a fund upstream. laredo petroleum has great acreage and is a low cost producer. i'm wondering your thoughts on lpi. >> i'm not with you on that. i understand you want to do a speck spec, but why not buy a mobil, they have much more firepower and the great kicker out of israel. i think noble is your play. let's if to kurt in tennessee, please. >> caller: hey, jim, how you doing? >> well, i feel better than i sound. how about that? >> caller: hey, i have a question for you. i bought cog about a year ago. it's little down not done a whole lot. should i buy some more or sell or hold?
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>> i'm concerned about natural gas not bouncing back. i don't want you to buying any more cabot. hold it there. jim in idaho, jim. >> caller: yes. the last year i bought some shares of this board walk pipeline partners. i thought they were construction projects and the expansion they had that i'd get a price depreciation. i haven't got any -- >> no, that's a valuable asset. i'm telling you one of the pipeline companies is going to snap that up and probably going to pay 24, 25 for it. don't you dare sell board walk. if anything i would do some buying. all right the time to buy the oils came and went, my friends. if you're thinking about getting into the game now, you're late to the party. you have to wait for the stocks to come down. there's much more "mad money" ahead including the revolution happening in hospitality. hotel tonight is the easiest way to travel and it's quickly grown
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into the threat of the online booking players even though they're doing well too. my series "defining the future" continues with the ceo. harmon not that spectacular, but is today's big decline an opportunity to buy at a discount or time to take a different tune. i sit down with your ceo. and the calls answered in the east coast edition of the lightning round. there's some facts about seaworld we'd like you to know. we don't collect killer whales from the wild. and haven't for 35 years. with the hightest standard of animal care in the world, our whales are healthy. they're thriving. i wouldn't work here if they weren't. and government research shows they live just as long as whales in the wild. caring for these whales, we have a great responsibility to get that right. and we take it very seriously. because we love them. and we know you love them too.
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all right. what the heck just happened to long time cramer favorite harman international? they're the maker of high end entertainment like the car stereos, top notch professional grade gear but the main business is making automobile infotainment systems that integrate safety solutions and the software that makes it all run. when you think of the connected car you're thinking of harman. they have been an incredibly consistent performer but the headline numbers came in below wall street's expectations. management cutting the full year earnings forecast and the stock is down ten bucks in a single session. what's the deal here?
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in part, they're another one of the victims of the strong dollar. their 14% revenue growth turned into just 4% growth after factoring the impact of currency. more than that though, i think this is a case where the analysts got too enthusiastic after harman blew away the numbers in a quarter that was so good that it sent the stock soaring from 101 to 125 in a single day. since then the analysts raised their estimates for the quarter pretty aggressively. and the fact that harman had grown dramatically and you can see how it got crushed like this on results that seemed pretty darn good. i think it's a high quality story, and my view is this pull back can give you a nice entry. let's speak to dinesh paliwal and hear more about the quarter and where the company is headed. good to see you today. >> good to see you. >> you were the first person in the conference call that actually explained how a strong dollar can hurt a company.
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you said you had to make certain allowances like to a russian company just literally because the dollar is so strong. >> absolutely right, jim. you can only do certain things but in the end, what are the investment pieces? as you just said, harman is all about leading the connected car, the automotive space. nothing changes. the auto sector is very strong. we came in 19% growth in the automotive business. car audio is all time high and in this quarter we got a record high $3.2 billion worth of autos from the next generation of the connected car. with cloud based applications and that's all good. i think where we got head wind is 20% of the company's business is in professional audio. >> right. >> which has a dollar denominated price book and they do a lot of business in high interest countries like china and india and brazil and they
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have underperformed. number two, we're not so competitive against japanese currencies. so we're taking some actions here to address the issues and we'll bring this -- this is still a profit leader in the company. but the main cobusiness was extremely well. and now we're bringing in the cloud based analytics which will help the automotive car. >> i was out in the west coast, silicon valley. they believe we'll have driverless cars. that would be great for you, wouldn't it? >> absolutely. i think that's where we're going. >> you think we are? >> i think we are. the research came out 220 million cars would be totally connected in 2016. that's not too far from here. so to connect the cars what has to happen? we need to make safety as an number one -- as a number one priority. that's smart infotainment safety security as soon as you bring the pipe of 4 g, 5 g, that
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content can back things and so we just bought two companies. one in israel which also had tremendous cyber security based operation in france. >> right. so this company does over -- from the cloud updates into the car. not just for harman but a lot of the other -- >> i thought -- i thought that was a great acquisition. you have a great report. the acquisitions and so you talked about the israeli one. now, symphony, it does have some stuff that you don't need. right? i mean you'll try to integrate that or just sell some of the parts? >> no, actually this is the diversification. because we're a clear leader in the automotive industry and we wanted to grow in high growth, high in services the cloud and they're -- they brought to us higher than our company average ebitda. so they're coming in 15 or 16% ebitda and we intend to grow
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them in the 15 to 20 ebitda margin. this is a separate division. they do banks and retail, high end. >> i saw that and i got nervous. that's not necessarily your core expertise. >> exactly. so this competence is what we're missing to make the connected car vision a full reality. so with their help now we can do all their updates and do cloud based applications and make our total connected division as a reality. >> wait to finance? how does it work? that you need this other verticals? >> so this vertical will bring in the software come me tense of the cloud based and the updates and all the services in the car. which was something harman did not have traditionally. and what they do well all the cloud analytics they'll continue to do that and we'll own that business. so this would be a growth initiative of harman. 15, 18% growth year over year and the profitability which is higher than the harman's company
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profitability. >> okay, good. because i was concerned -- saw -- i saw the other things. maybe you have to take charge and sell those. no, you're going to keep them and keep them intact. >> grow them. we became the fourth largest microsoft cloud implementation partner. and cloud implementation is we're doing for hb for target. for the u.s. for the fraud detection system of target stores in the u.s. a lot of learning -- >> you're comfortable with all the new things? >> i'm very comfortable because jim, i have done a lot of services businesses in my former life, but here's a tremendous synergy. plus what they do is actually continue to build the platform technology which will apply to what we do. >> all right. margins go up, then i'm on board. i like it. >> and one other thing -- >> oh. well, we'll have to wrap it up. we'll be able to come back to it. that's dinesh paliwal, president and ceo of harman.
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these acquisitions are hard to understand. you have to look at them but i have a great explanation for why you took them so thank you so much. stick with cramer.
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>> announcer: lightning round is sponsored by td ameritrade.
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>> before we begin, i want to give a big congratulations to our long time lightning round sponsor td ameritrade on the fabulous 40th anniversary. what a milestone. booyah to the entire team. and now it is time. it is time for the lightning round. i take your calls you say the name of the stock. i don't know the calls or the name of the stock ahead of time. i tell you whether to buy or sell. when you hear this sound -- [ buzzer ] -- then the lightning round is over. are you ready, skee-daddy? time for the lightning round on cramer. let's start with patrick in arizona. patrick? >> caller: hi, jim. last year i bought isis and opk and they had a great year but now the last week i'm concerned. do i take some off the table -- >> isis, i said in the '70s that i was done. i like it, but i don't want to recommend anymore. i still like -- doing a lot of good stuff.
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doesn't mean i don't like isis but listen the biotech other than receptors i'm not saying you should buy them right now. jason in california jason. >> caller: hey, what's up with ensco? >> it reported higher. in "get rich carefully" that's often a sign of a bottom. it does mean that it may have stopped going down. let's go to scott in california. scott? >> caller: hey, jim. that's my "mad money" way to congratulate you on your recent marriage. >> thank you very much. i'll tell lisa you said that. >> caller: you talked about how low gas prices are causing consumers of to spend more like at restaurants and i want to ask you about a stock that thrives in this spending environment. what do you think of groupon? >> you know what, i think groupon is just -- it's kind of a breakup story now. so i can't tell what it's worth. it's not really an earnings story that's too hard for me. especially after what happened
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with yelp today. let's go to kevin in arizona. >> caller: hey, welcome home, jim. >> thank you, kevin. >> caller: hey, buddy, it's spring time. what about sonic? >> it's down way too much. you know what, this is the level that we should do some buying. i know the chart is terrible, but i like sonic. let's go to betsy in california. >> caller: hey, can you tell me if it's a great stock. i'm talking about buy, sell or hold -- >> splupgning is one of the best there is. that's a good company. that, ladies and gentlemen, is the conclusion of lightning round. >> announcer: the lightning round is sponsored by td ameritrade. like a custom screener on your desktop, that updates to all your devices. and you can share it with one click. wow. how do you find the time to do all this? easy. we combined every birthday and holiday into one celebration. (different holidays being shouted)
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♪ one major take away from my visit to san francisco -- at the epicenter of the connectively revolution, convenience is king. oh that's sam elliott voice has to go away soon. if a company can avoid a disaster, it will have no
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trouble raising venture capital money. take hotel tonight. a privately held company with a mobile app that allows you to book rooms in a range of hotels at the last minute. it is filling an unmet need for both consumers and for the hoteliers. as a given date approaches and the rooms are unbooked the hotel will drop its rates dramatically to fill the rooms and hotel tonight plays matchmaker between those hotels and any traveler looks for a great last minute deal and they do it with a slick app that lets you make a reservation in less than ten seconds. that includes an app for the apple watch that they just launched. it's not their app but i like mickey. just last night, we got a chance to chat with sam shank. this guy is a serial entrepreneur who's the cofounder and ceo of this really cool company, hotel tonight. take a look. sam, with the private companies i'm trying to explain to people what they do and why we need them. not what they're going to make
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this quarter and how big the year is going to be. why do i need hotel tonight as a consume ever and why do i need it as a hotelier? >> so we're a marketplace, we have two customers. for the consumer side we make this great mobile app that makes it really easy to snag a room at the last minute. so tonight, but also up to seven days in advance, a week in advance. and we save you money, we save you time. and for the hotels on the other side of the market they have empty rooms, about 40% of all hotel rooms in the country, in the world are empty right now. we can help them fill those rooms. it's win-win. you get a deal you get a great hotel. hotels get incremental revenue. >> all right the phone rings, it's someone who wants a room i book the room i leave the key on the table. why do -- why do i need hotel tonight, why do they need hotel tonight? they have the phone, i book the room. >> so the state of the art that we replaced four years ago was -- remember in airports you had the big banks of phone and
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you had to call each hotel individually, and you didn't know if jim was giving you a good deal or jim was like this guy, i'm going to jack up the price. you can shop ayos the hotels and it's a marketplace where they're competing against each other. make sure that the hotels are being honest, make sure that the hotels are pricing accordingly in the market. >> ease of purpose. i understand that i have got the apple watch. >> all right. >> how quickly can i get my -- oh -- >> there you go. so we were one of the first apps that enabled hotel booking on the apple watch. and what you can do you can open the app. i want shows you the five closest hotels to you. two more seconds you can book that room. you don't have to take your phone out of your pocket. >> right. >> you can keep going on with the night. if you're, you know, at a place where it's inconvenient to take out or impolite to take out your book, you can -- take out your
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phone, you can book your room. >> sam, yelp reported this weekend and they didn't report a great quarter. why wouldn't they buy your company or "b" i see he has a good business, i'm going to open my business against him? >> i don't know if we're interested in selling to him. that's the first place. what people underestimate in this type of business, we have seen people try and do what we have tried to do. some start-ups across the world and the big guys. this is a difficult business. you're dealing with last minute inventory and dealing with finding someone a place to stay. it's hard to launch and then harder to scale. and do this at the scale of thousands of thousands of hotel rooms every day. >> so you line up enough partners to block anyone? >> we don't do exclusive relationships. we're hotel friendly. there's actually an app that the hotels can use that where they ask say i want to stop selling all my hotel rooms right now and you can load the inventory in and out quickly.
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this is is a sales pitch for your hotel. >> i like it. variable pricing. 8:00, if i'm running a hotel, still got a chance people are going to come in. at 9:00, it's getting tough. at 10:00 i'm going to lose the rate. can i lower my rate at your app? >> you have full control, you can lower your rate in realtime add inventory. we see that hotels do in the most mature markets like new york city, hotels will adjust their inventory up to 15 times a day. so they're adjusting the rates up and down. they're playing with the market dynamics, filling the rooms at the best possible rates. generally rates do decline, you know, late at night you'll find the best deals. >> you are from this hospitality. you know kayak and priceline. do you want to partner with them or defeat them? >> they're our competitors. no question about it. and we are stealing share from them. they have tried to replicate us. we invented this category, we're the largest in what we do.
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we deal with the absolute best. >> the largest and fastest does tend to win out here, i have learned that much in my time in san francisco. sam shank, president and ceo. be on the lookout for it. stay with cramer. stay with cramer. and why stop what you're doing to find a bathroom? with cialis for daily use, you don't have to plan around either. it's the only daily tablet approved to treat erectile dysfunction so you can be ready anytime the moment is right. plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision or any symptoms of an allergic reaction stop taking cialis and get medical help right away. why pause the moment?
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look i know it's gloomy out there. but let's not give up the ghost here. i always say that's a bull market somewhere. i promise to find it right here for you on "mad money." i'm jim cramer. i will see you tomorrow! ll see you tomorrow!
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>> it's an intimidating crowd, the whole white collar camp or club fed, that doesn't exist anymore. that's a myth. >> when you're sent to prison


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